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5.Troubled companies

This category contains 195 posts

10 Feb 2018 (AFR) – China’s HNA in $US4 Billion sell-off

(10 February 2018, AFR, p12, by Sarah Mulholland) ‘The troubled Chinese conglomerate HNA Group  is selling a raft of buildings across the US as the once-voracious acquirer looks to cut its massive debt. Among the properties on the block is 245 Park Avenue in New York, according to a marketing document seen by Bloomberg. HNA bought … Continue reading

6 Feb 2018 (TheAge) – Bill Lewski pays zero to walk away from $190m suit, investors get zip

[COMMENT: This news story provides an interesting insight into what can go wrong with investments, and the extent to which the investors’ funds might be at risk.] (6 February 2018, The Age, p11, Sarah Danckert) ‘Controversially forgetful businessman Bill Lewski has paid nothing to walk away from $190 million in civil claims brought against him, … Continue reading

3 Feb 2018 (AFR) – Seeds of doubt in Quintis forestry trail

[COMMENT: An interesting insight into some of the things that might go wrong for investors.] (3 February 2018, AFR, p27, by Vesna Poljak) ‘Missteps bedevilled the timber project developer. “The long and short of it is that forestry assets take time to mature, which requires capital, which, in turn, requires trust. With trust gone, the … Continue reading

2 Feb 2018 (AFR) – Xerox, an innovator hit by digital revolution, cedes control to Fujifilm

[COMMENT: Over the years, as technology develops, some major companies fail to keep up with technology and come across tough times. This happened to Kodak in recent years – a company well known to many people around the world, but not perhaps amongst the younger generations. Now it is Xerox’s turn. This can be a … Continue reading

25 Jan 2018 (AFR) – Quintis: Inside the year that broke the sandalwood grower

(25 January 2018, AFR, p37, by Vesna Poljak) ‘In March 2017, a celebrity crowd toasted the rebranding of sandalwood grower Quintis at the Glasshouse in Melbourne’s sporting precinct. AFL boss Gillon McLachlan attended with cricketers Ricky Ponting and Adam Gilchrist, a former director of the company back when it was known as TFS.’ <snipped…> ‘This … Continue reading

23 Jan 2018 (AFR) – US hedge fund Glaucus blasts tax breaks for MIS after Quintis joins failures

(23 January 2018, AFR, p13, by Vesna Poljak) ‘The hedge fund that brought down listed sandalwood grower Quintis has urged Australian policymakers to rethink tax incentives for managed investment scheme investors after the former TFS Corp became the latest failure in a long line of forestry-linked collapses. Quintis appointed administrators on Saturday, ending a months-long … Continue reading

22 Jan 2018 (TheAge) – Sandalwood company Quintis collapses into administration

(22 January 2018, The Age, Business, p23, Cara Walters) ‘Sandalwood company Quintis has collapsed with Korda Mentha appointed as administrators. Quintis is listed on the Australian Securities Exchange and owns and manages more than 12,000 hectares of Indian sandalwood plantations across northern Australia.’ Read more at

17 Jan 2018 (AFR) – Behind the collapse of UK construction giant Carillion

(17 January 2018, AFR, p31, by Kimiko de Freytas-Tamura) ‘The British government scrambled Monday to contain the damage as the country’s second-largest construction firm was forced into liquidation after losing money on a series of contracts and racking up around $US1.35 billion ($1.75 billion) in debt. The bankruptcy of the firm, Carillion, one of the … Continue reading

17 Jan 2018 (AFR) – Carillion’s collapse puts spotlight on Britain’s unfunded pensions

(17 January 2018, AFR, p10, by Lukanyo Mnyanda) ‘The collapse of Carillion Plc with more than half a billion pounds of unfunded pension commitments may increase pressure on some of the nation’s biggest companies to plug their own funding gaps. The construction giant employs almost 20,000 people in Britain and has a pensions shortfall of … Continue reading

17 Jan 2018 (TheAge) – ‘This is a very sad day’: UK government seeks to limit damage after Carillion collapses

(17 January 2018, The Age, Business, p24, Kate Holton) ‘London: Britain’s Carillion collapsed on Monday after its banks lost faith in the construction and services company, forcing the government to step in to guarantee major public works contracts. In one of the biggest British corporate failures in recent years, Carillion went into compulsory liquidation after … Continue reading

16 Jan 2018 (AFR) – ‘Hundreds of firms at risk’ if construction giant Carillion fails survival

(16 January 2018, AFR, p32, by Iain Withers) ‘Crisis-hit construction firm Carillion’s future remained in the balance last night as the Government held last ditch talks on whether to bail-out some of its most troubled contracts. Accountancy firm EY was waiting in the wings to potentially put the 5.2 billion pound ($9 billion) revenue contracting … Continue reading

10 Jan 2018 (TheAge) – RFG shares slump as it warns on profit for second time in three weeks

[COMMENT: Here is another case study example to indicate that astute short term investors and traders would have protected their capital by selling the stock before the shock profit warnings. It is not possible to tell whether this stock will recover, or continue into oblivion and perhaps be snapped up by hedge funds or the … Continue reading

2 Jan 2018 (AFR) – Tough Christmas could help Oroton in rent fight

(2 January 2018, AFR, p13, by James Thomson) ‘Poor Christmas sales for Australia’s retailers could actually help Oroton’s new owners, led by fund manager Will Vicars, as they prepare for a fight with some of Australia’s biggest landlords. Mr Vicars, the chief investment officer at Caledonia, signed a deal with Oroton’s administrators on December 23 … Continue reading

21 Dec 2017 (AFR) – Steinhoff scandal expected to trigger asset sales in Australia

(21 December 2017, AFR, p13, by Sue Mitchell) ‘Steinhoff International’s $1 billion Australian business could be split up and sold off if banks owed €10.7 billion ($16 billion) ignore the company’s pleas for support and pull the plug. Industry players believe Steinhoff’s Australian furniture businesses Freedom, Fantastic Furniture and Snooze, and department store chains Harris … Continue reading

20 Dec 2017 (TheAge) – Retail Food Group shares plunge 25% on profit downgrade

(20 December 2017, The Age, Business, p23, Patrick Hatch) ‘Retail Food Group’s shares have gone into freefall after the cafe and bakery giant issued a profit downgrade and admitted franchisees were leaving its network. RFG’s shares plunged 25 per cent to $1.98 on Tuesday, after the company said it expected its first-half statutory net profit … Continue reading

12 Dec 2017 (AFR) – Department stores set for decade-long tumble: Morningstar

(12 December 2017, AFR, p17, by Luke Misthos) ‘The number of bricks-and-mortar department stores will shrink by 26 per cent over the next 10 years, Morningstar predicts, singling out Wesfarmers’ Kmart as the best prepared for the decade ahead. Bricks-and-mortar sales will decrease by 2 per cent a year over the next decade, resulting in … Continue reading

12 Dec 2017 (TheAge) – Retail Food Group’s shares plunge to five-year low

[COMMENT: In the current retail climate, one might be quick to blame Amazon’s arrival in Australia for this disaster; but take a look at my price chart and note that the price downtrend has been in place for about a year. Investors should have quit the stock about 6 months ago.] (12 December 2017, The … Continue reading

1 Dec 2017 (AFR) – OrotonGroup collapses into administration – The latest retail casualty

(1 December 2017, AFR, p19, by Sue Mitchell) ‘The “rags to riches in three generations” adage has played out again. This time it’s family-controlled retailer OrotonGroup, which has fallen into administration. Sydney’s wealthy Lane family, the major shareholder in the upmarket accessories chain, must be regretting a decision 12 years ago to reject takeover offers from … Continue reading

8 Aug 2017 (AFR) – Banks still paying for GFC – Rack up $US150b in US fines since start of the financial crisis

(8 August 2017, AFR, p29, by Kara Scannell) ‘Financial institutions have paid more than $US150 billion ($189 billion) in fines in the US relating to the credit crisis, passing a significant milestone a decade after it became clear that the country’s subprime woes had become a global problem. Ten years ago this week, France’s BNP Paribas … Continue reading

21 July 2017 (AFR) – Sales slump undermines Myer turnaround plan

(21 July 2017, AFR, p32, by Michael Smith) ‘Richard Umbers’ plan to fix Australia’s biggest department store group is being undermined by an alarming drop in sales, but the Myer boss is not…’ Read more at (might need AFR login access, or try:

19 July 2017 (TheAge) – Wellard shares hammered as weak Asian demand hits cattle exports

[COMMENT: Any reasonable trader/investor who likes to protect their capital would surely have had a Stop Loss exit ready for this stock (in fact all stocks), and actually exercised it. Since listing in December 2015, the share price has seen a continual downtrend (and we know from Dow Theory that a confirmed trend is likely … Continue reading

14 June 2017 (AFR) – Baby Bunting shares crunched by fear of Amazon

[COMMENT: Most technical analysts who might have been holding this stock in late 2016, would have spotted the downtrend in late 2016, which continued into 2017, and they most likely sold their position to lock in profits and preserve their capital. See the chart below.] (14 June 2017, AFR, p19, by Simon Evans) ‘In just … Continue reading

1 Mar 2017 (TheAge) – Watersun Homes goes into administration

(1 March 2017, The Age, BusinessDay, p27, Simon Johanson, Emma D’Agostino) ‘A home building company that at one stage sponsored the St Kilda Football team, Watersun Homes, has gone into administration with the loss of 90 jobs. The residential builder was working on about 300 homes in metro Melbourne and regional Victoria when it was … Continue reading

3 Oct 2016 (AFR,TaipeiTimes) – China needs to heed warnings on property

(3 October 2016, AFR, p22, By Andrew Sheng and Xiao Geng, Taipei Times) ‘Real-estate prices in China’s top cities are spiking, generating contradictory predictions of either bursting bubbles or an economic turnaround. What is really going on in China’s property market? The Chinese National Bureau of Statistics last week revealed that 10 of the 70 … Continue reading

3 Oct 2016 (AFR) – China determined to lower debt levels says top banking official

(2 October 2016, AFR, p1, by Angus Grig, Lisa Murra) ‘The Chinese government is determined to lower debt levels across the economy, but this should be done gradually to avoid a sharp slow-down in growth, according to one of the country’s most senior banking regulators. Wang Shengbang, deputy director of the Prudential Regulation Bureau of … Continue reading

30 Sept 2016 (AFR,NYTimes) – Deutsche Bank Is the Darling of the Short-Sellers

(30 September 2016, AFR, p36, By LANDON THOMAS Jr., New York Times) ‘In a market full of crowded trades, few have become as fashionable as the bet that Deutsche Bank’s stock price will keep on falling. Hedge funds, large and small, are shorting the stock. Long-term institutional investors are dumping their positions. And Wall Street’s … Continue reading

20 Sept 2016 (TheAge) – Sydney psychic advised BBY chairman Glenn Rosewall on ‘chakras and share prices’

[COMMENT: Now there might be some people who think that the considerations that are explained in this article are reasonable when it comes to managing a business; but many people wouldn’t accept this approach. The details in this article are truly eye-opening.] (20 September 2016, The Age, BusinessDay, p16, Michaela Whitbourn) ‘It is not often … Continue reading

14 Sept 2016 (AFR) – BBY management allegedly told staff not to write down finance discussions

[COMMENT: It is difficult to believe that events such as this can happen within companies that we trust.] (14 September 2016, AFR, p3, by Misa Han) ‘Collapsed stockbroker BBY was dipping into clients’ trust accounts for business purposes as early as 2012 and threatened to sack staff who refused to take money out of clients’ accounts. BBY … Continue reading

8 Sept 2016 (AFR) – Hanjin’s ghost ships seek havens as bankrupty action looms

(8 September 2016, AFR, p44, by Sohee Kim and Kyunghee Park) ‘South Korea’s cash-strapped Hanjin Shipping Co is adrift at sea – and in more ways than one. Hanjin is one of the world’s biggest shipping lines and filed for bankruptcy protection last week in Seoul. That’s created a bizarre situation on the high seas for … Continue reading

31 Aug 2016 (AFR) – Estia becomes worst stock on ASX 200 index – Estia Health share price hammered as debt concerns raised

(31 August 2016, AFR, p32, by Matthew Cranston) ‘The share price of one of Australia’s largest aged care operators and developers, Estia Health, has collapsed as investors and analysts reevaluate the company’s issues and future growth prospects. The company, which is now the worst-performing stock on the ASX 200 this year and trades with a negative net tangible assets per security, … Continue reading